Payment companies saw record new sign-ups and increased volumes on online channels as the pandemic disrupted traditional payment methods.
“The lockdown has also brought many people — who were not very tech savvy and aware of digital payments — closer to the ecosystem,” said Sunil Khosla, president – digital business, India Transact Services Ltd – an omni channel payments player.
India Transact recently conducted a survey on the payment behaviour of millennials during the lockdown. According to the results of the survey, shared with ET, about 57% of respondents used digital payments five to six times a week, while 21% used it three times a week.
Nearly 76% of respondents were willing to use digital payments because of better rewards in the form of incentives, discounts and cashbacks, while 70% said the number of digital transactions had increased because of the Covid-19 pandemic.
Leading payment companies monitoring key payment channels also said there had been increased dependence on digital mediums for key services, which were reflected in their daily volumes.
For instance, in the 100 days of the lockdown between March 24 and July 2, Razorpay saw spends on online education grow by 23%, medical purchases by 20% and those on social engagements — which include personal counselling, dating and matrimony websites – increase by 32%.
Utility bill payments, meanwhile, grew 163% during the period, its latest fintech trends report showed.
“Covid-19 is forcing sectors to digitize, as businesses can’t be closed for long and social distancing is here to stay, for the next 12 months at least,” said Harshil Mathur, CEO of Razorpay.
PhonePe, too, said sign-ups across all age and demographic categories had spiked during the lockdown.
“Our new user acquisition has grown by 50% as digital payments have been adopted by people across all segments for multiple use cases,” said Karthik Raghupathy, VP – strategy and business development, PhonePe.
The biggest increase came from recharges and bill payments, he added.
Offline payment businesses are also showing encouraging signs of early pick up, with small businesses gradually reopening following relaxations in the nationwide lockdown.
Innoviti, a leading point-of-sale terminals deployer, said the surge in payments to categories such as grocery, consumer durables and technology items, was led largely by the reopening of businesses in small towns. Moreover, customer shopping trends had also undergone a change as they adjusted to a work-from-home routine.
The average ticket size on grocery bills increased by 12%, while the number of transactions fell by 20% against pre-pandemic levels, data shared with ET showed.
“This is because people are shopping less frequently, especially in metro zones,” said Rajeev Agrawal, CEO of Innoviti.
People are also shopping through the week without sharp distinction between weekdays and weekends – a departure from the pre-pandemic trend of most shopping taking place on weekends, he said.